British homebuilder Bellway announced a smaller-than-anticipated decline in annual revenue on Friday and noted an improvement in buyer confidence following a reduction in mortgage rates. The homebuilding sector in the UK, which has been affected by a prolonged cost-of-living crisis, is expected to benefit from the first reduction in UK interest rates in over four years.

Earlier this month, many UK mortgage lenders lowered their rates in anticipation of this long-awaited change, although the Bank of England has downplayed the likelihood of a series of rapid rate cuts.

Bellway indicated that customer confidence has been bolstered by the moderation of both mortgage interest rates and consumer price inflation, along with rising wages. This more optimistic outlook coincides with Britain?s new Labour government's plans to address the country?s chronic housing shortage by relaxing planning restrictions and increasing the availability of land.

The company reported that its annual revenue fell by approximately 31% to $3 billion, surpassing analysts' average forecast of ?2.27 billion, according to LSEG data. Bellway's annual underlying operating margin is expected to be around 10%, down from 16% the previous year, as noted in its trading update.

Bellway, which builds a range of properties from single-room apartments to luxury penthouses, stated that its forward order book?a key industry measure of demand?was valued at ?1.41 billion at the end of its financial year, compared to ?1.19 billion the previous year. Larger competitors such as Persimmon and Taylor Wimpey have predicted that their annual housebuilding figures will be at the higher end of their guidance range, highlighting market expectations of a recovery in demand.